Section 536 Contributions not made by public bodies and not eligible for tax relief

United Kingdom

(1)

A person (“R”) is to be regarded as having incurred expenditure (despite section 532(1)) to the extent that the requirements in subsections (2) and (3) are satisfied in relation to the expenditure F1(but see subsection (6)).

(2)

The first requirement is that the person meeting R’s expenditure (“C”) is not a public body.

(3)

The second requirement is that—

(a)

no allowance can be made under Chapter 2 in respect of C’s expenditure, and

(b)

the expenditure is not allowed to be deducted in calculating the profits of a trade or relevant activity carried on by C.

(4)

When determining for the purposes of subsection (3)(a) whether an allowance can be made under Chapter 2, assume that C is within the charge to tax.

(5)

In subsection (3)(b) “relevant activity” means—

(a)

for the purposes of Part 2—

(i)

F2a F3UK F4property business;

F5(ii)

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(iii)

an F6F7... overseas property business;

F8(iiia)

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(iv)

a profession or vocation;

(v)

any concern listed in F9section 12(4) of ITTOIA 2005 or F10section 39(5) of CTA 2009 (mines, transport undertakings etc.);

(vi)

the management of an investment company;

(b)

for other purposes, a profession or vocation.

F11(6)

Subsection (1) does not apply for the purposes of Part 2A (structures and buildings allowances).

Annotations

Textual amendments

F1: Words in s. 536(1) inserted (5.7.2019) by The Capital Allowances (Structures and Buildings Allowances) Regulations 2019 (S.I. 2019/1087), regs. 1, 3(9)(a)
F2: Word in s. 536(5)(a)(i) substituted (for the purposes of corporation tax, in relation to accounting periods beginning on or after 1.4.2025 and, for the purposes of income tax, in relation to periods of account beginning on or after 6.4.2025) by Finance Act 2025 (c. 8), Sch. 5 paras. 8(18)(a), 12(3) (with Sch. 5 paras. 15, 18, 19)
F3: Word in s. 536(5)(a)(i) inserted (with effect in accordance with Sch. 14 para. 13 of the amending Act) by Finance Act 2011 (c. 11), Sch. 14 para. 12(15)(a)
F4: Word in s. 536(5)(a)(i) substituted (6.4.2005) by Income Tax (Trading and Other Income) Act 2005 (c. 5) , s. 883(1) , Sch. 1 para. 570(a) (with Sch. 2 )
F5: S. 536(5)(a)(ii) omitted (for the purposes of corporation tax, in relation to accounting periods beginning on or after 1.4.2025 and, for the purposes of income tax, in relation to periods of account beginning on or after 6.4.2025) by virtue of Finance Act 2025 (c. 8), Sch. 5 paras. 8(18)(b), 12(3) (with Sch. 5 paras. 15, 18, 19)
F6: Word in s. 536(5)(a)(iii) omitted (for the purposes of corporation tax, in relation to accounting periods beginning on or after 1.4.2025 and, for the purposes of income tax, in relation to periods of account beginning on or after 6.4.2025) by virtue of Finance Act 2025 (c. 8), Sch. 5 paras. 8(18)(c), 12(3) (with Sch. 5 paras. 15, 18, 19)
F7: Words in s. 536(5)(a)(iii) substituted (with effect in accordance with Sch. 14 para. 13 of the amending Act) by Finance Act 2011 (c. 11), Sch. 14 para. 12(15)(c)
F8: S. 536(5)(a)(iiia) omitted (for the purposes of corporation tax, in relation to accounting periods beginning on or after 1.4.2025 and, for the purposes of income tax, in relation to periods of account beginning on or after 6.4.2025) by virtue of Finance Act 2025 (c. 8), Sch. 5 paras. 8(18)(d), 12(3) (with Sch. 5 paras. 15, 18, 19)
F9: Words in s. 536(5)(a)(v) inserted (6.4.2005) by Income Tax (Trading and Other Income) Act 2005 (c. 5) , s. 883(1) , Sch. 1 para. 570(b) (with Sch. 2 )
F10: Words in s. 536(5)(a)(v) substituted (with effect in accordance with s. 1329(1) of the amending Act) by Corporation Tax Act 2009 (c. 4), s. 1329(1), Sch. 1 para. 516 (with Sch. 2 Pts. 1, 2)
F11: S. 536(6) inserted (5.7.2019) by The Capital Allowances (Structures and Buildings Allowances) Regulations 2019 (S.I. 2019/1087), regs. 1, 3(9)(b)